Michigan EIBC Members on DG Rates, Public Forum on DTE Resource Plan, State Legislature Passes Solar Tax Bills

Michigan EIBC Members Speak Out About New Distributed Generation Rates

The debate over how to value distributed solar goes on, as Michigan EIBC and its members continue to draw attention to the fallout from the recently approved DTE distributed generation tariff.

Michigan’s National Public Radio affiliate, Michigan Radio, prominently featured two Michigan EIBC members – The Green Panel and Michigan Solar Solutions –  in a storyabout how the “inflow/outflow” model adopted by DTE and the Michigan Public Service Commission (MPSC) is confusing customers.

As The Green Panel’s Mark Cryderman explained in a quote from the story, the structure of the new rates for distributed solar customers makes it very difficult for a customer to calculate the exact ROI for a rooftop solar project. This is because rather than averaging energy use and solar production over the month, the new tariff requires a minute-by-minute accounting of electricity flows. Despite this hurdle, customers still get a return on their solar arrays, and The Green Panel, Michigan Solar Solutions and other solar installers are moving ahead, in part buoyed by growing customer interest in battery storage.

But the problem remains that the new distributed solar rates fail to fairly compensate customers with solar systems because they do not take into account various benefitsdistributed generation provides, such as increasing reliability and reducing transmission losses.

Legislation to fix the uncertainty and complexity in calculating ROI and compensate distributed solar users fairly is underway. As the story explains, state Rep. Yousef Rabhi, who introduced similar legislation last session that was supported by Michigan EIBC, is working on new legislation in response to the new tariff.

Michigan EIBC continues to treat this issue as a top priority. The DTE distributed generation tariff is a focus of the June 21 in-person EIBC member meeting in Lansing.   

Debate Over DTE IRP Ramps Up at Detroit Public Forum

The Michigan Public Service Commission (MPSC) held a forum in downtown Detroit on June 20 for members of the public to voice their opinions on DTE Energy’s long-term integrated resource plan (IRP). Several days earlier, Michigan EIBC published an analysisof the IRP that laid out the ways DTE has missed opportunities for competitive procurement of clean energy, to the detriment of its ratepayers.

Several Michigan EIBC members were present at the forum to explain concerns with the IRP and how it can be improved.

“PURPA developers and behind-the-meter customers could help rapidly develop renewable energy,” Rob Rafson, president of Michigan EIBC member Chart House Energy, said in comments before the three MPSC commissioners. But DTE for the most part leaves third-party developers and distributed renewable energy out of its long-term planning.

Many other states have long required utilities to file regular integrated resource plans that lay out how they will meet customer needs over a multi-year timeframe. The IRP approval process gives regulators and the public another lever to hold utilities accountable. Following passage of the 2016 energy laws, in late 2017 the MPSC approved requirements for IRP filings.

The crowded forum included many residents from surrounding Detroit communities who expressed their dissatisfaction with the IRP and its lack of focus on the most affordable energy options. Ken Zebarah, sales manager for Michigan EIBC member Harvest Energy Solutions, told the commissioners that DTE could meet its renewable energy goals through measures, like buying renewable energy credits from small solar arrays as well as larger utility-scale projects, that are much more cost-effective than the ones the utility is proposing.

Since DTE filed the plan in March, Michigan EIBC has been an active intervenor. Intervening groups will be filing testimony to the MPSC later this summer.   

Michigan Lawmakers Approve Bills On Solar and Property Taxes

On June 20, the Michigan House passed two bills that would give certainty to customers interested in installing their own renewable energy systems that such projects will not cause their property taxes to go up. Once the package of bills passes both chambers, Gov. Whitmer is expected to sign them.

HB 4465, sponsored by Rep. Rabhi, would reinstate a tax exemption for “alternative energy personal property” like rooftop solar, fuel cells, wind, combined heat and power, and battery storage. The other bill, HB 4069, sponsored by Rep. Kahle, would add alternative energy systems to the list of repairs and household upgrades that are not considered when determining the true cash value of a property for assessment purposes, until the property is sold.

The Michigan Senate unanimously passed versions of the bills, sponsored by Sen. Barrett, SB 47 and SB 48, on June 12. Similar legislation has been proposed for the past couple of years, and along the way Michigan EIBC explained to the media how renewable energy projects have not been on a level playing field with other forms of generation that do not cause residents to be surprised with a higher property tax bill.

Michigan EIBC And Others Speak in Favor of Microgrid Legislation Before Michigan House Energy Committee

On June 19 Michigan EIBC VP of Policy, Cory Connolly, was among those who presented testimony to the Michigan House Energy Committee about proposed legislation that could allow microgrids to take off in Michigan as they have elsewhere in the country.

While “critical facilities” like hospitals can use backup generators to keep power on even when the electric grid goes down, the development of the full concept of a microgrid–a localized area of electric load that can disconnect from the main grid and function as an “island”–is currently stymied by state law.

Microgrids can significantly expand the availability of power once the grid goes down above and beyond what generators can do. One example discussed during the committee hearing was the infamous blackout of 2003, in which the grid went down across the northeastern U.S. and Canada from Michigan and Ontario to Massachusetts. At the University of Michigan in Ann Arbor, most of the campus lost power, while  the U of M hospital continued to operate on backup generators. But at Michigan State University, electricity kept running throughout the campus because the school’s facilities were electrically connected as their own island within the larger grid.

Michigan State was able to build that microgrid because it owned the contiguous buildings. But under state law, a critical facility cannot provide power to a third-party facility nearby even when the critical facility is electrically contiguous with the third party–meaning, connected by physical wires.

HB 4477 would remove that barrier and also allow critical facilities to provide services to the grid when there isn’t an emergency. Bill cosponsor House Rep. Steven Johnson, who also spoke to the committee, used the example of a hospital with a nursing home nearby, saying that the hospital with backup generators couldn’t currently provide power to the nursing home. Just as significantly, that these constraints can make valuable technologies like solar, battery storage, and combined heat and power impractical. For example, a fire station may not be a good site for solar because its roof is shaded by an adjacent parking structure. However, that same adjacent parking structure may have extra roof space to install a solar and storage project. Under current law, if the grid went down, the fire station would not be able to use solar power from the adjacent parking structure even though its need is critical and the parking structure is not.

Johnson also pointed out that microgrids will become more important as electric vehicles become more common. For example, a police station may need to form a microgrid with charging stations to ensure that electric police vehicles always have power.  

Renewing Members

Cypress Creek Renewables
Cypress Creek Renewables is a nationally-focused developer headquartered in Santa Monica, California. CCR has offices in Phoenix, San Francisco, Asheville, and Durham, as well as field offices in Chicago and now Plymouth, Michigan. CCR has over a gigawatt of operating assets in 10 states, plus pending development in the Midwest, Pacific Northwest, Mid-Atlantic, Northeast, Southeast, and ERCOT (Texas). Michigan is a key growth market for Cypress Creek.

Dickinson Wright
Dickinson Wright PLLC is a general practice business law firm dedicated to exceeding client expectations, with more than 450 attorneys in more than 50 practice areas. Headquartered in Detroit and founded in 1878, the firm has eighteen offices in Michigan, Ohio, Kentucky, Tennessee, Nevada, Arizona, Washington, D.C., Toronto, Florida and Texas. The firm is very active in clean energy.

Srinergy is a clean solar energy technology company with design and development capabilities, providing turn-key solar energy solutions for utility, commercial and industrial customers. We had great success in carving out a specialty niche for ourselves, and have earned an excellent reputation within the industry for reducing energy costs and reducing the carbon footprint for our customers.  

Michigan Energy News

  • The city council of Petoskey passes a resolution for the city to achieve 100% renewable energy by 2035.
  • Amidst the dispute with the state, Enbridge and a nonprofit supported by major oil companies and utilities are stepping up public campaigns calling for the Line 5 pipeline tunnel project to move forward.
  • Ohio Gov. Mike DeWine is also calling for the Line 5 pipeline to stay open in a recent letter sent to Gov. Whitmer.
  • Michigan regulators are working on rules for the environmental impacts that may come from legal recreational marijuana, including increased use of electricity.
  • Michigan State University researchers say they have developed the first completely transparent solar panels, which could potentially expand the type of surfaces on which solar arrays can be installed.
  • New Michigan EIBC member Aria Energy gets approval from a local zoning board in the Lehigh Valley of Pennsylvania to build a facility that would turn carbon dioxide and methane into natural gas.
  • The school districts of Ann Arbor and the Macomb County city of Roseville will be among the first in the state to receive electric school buses as part of a partnership with DTE.

National Energy News

  • New York state lawmakers have passed a bill to implement what many consider will be the most aggressive clean energy standard in the country, including a requirement that utilities get 70% of their electricity from renewables by 2030 and hit 100% zero-carbon electricity by 2040.
  • Some major pro-renewable energy groups are calling for a new tax credit for energy storage as tax credits for wind and solar approach their sunset.
  • A bipartisan group of U.S. senators and representatives introduces a bill that would allow solar, wind, battery storage and other types of clean energy companies to form master limited partnerships, giving them similar tax advantages as fossil-fuel companies.
  • Bloomberg New Energy Finance forecasts that wind and solar will rise from 7% of the world’s electricity generation today to 48% by 2050, and batteries will help the U.S. power supply to be 43% renewable by 2050.
  • Wood Mackenzie Power & Renewables reports that 2.7 GW of solar photovoltaic were installed in the first quarter of this year, the most ever installed in a first quarter.
  • Reversing his predecessor Chris Christie, New Jersey Gov. Phil Murphy movesto bring the state back into the Regional Greenhouse Gas Initiative carbon dioxide cap-and-trade system.
  • Nevada reinstated net metering two years ago, and has now risen to third behind California and Florida in terms of states that have installed the most solar in the first quarter of 2019.
  • The Chattanooga, Tenn., airport says it will be the first airport in the nation to produce enough electricity from a newly-completed solar farm to cover its daily power needs.
  • Kentucky follows in the footsteps of California, Iowa and Vermont with a decision that electric vehicle charging stations should not be regulated as public utilities.

Michigan Energy Events  

The Michigan Environmental Council is holding a Grand Rapids Clean Energy Forum on June 28 to talk about the current status of renewable energy in Michigan. RSVP here.

The 63rd annual Michigan Energy Providers Conference will be held July 24 to 26 at the Grand Hotel on Mackinac Island. The conference will include speakers such as FERC Commissioner Neil Chatterjee and CMS Energy and Consumers Energy President and CEO Patti Poppe.

National Energy Events

Attend the Clean Cities Renewable Procurement Summit in Denver, Colorado July 23-25. Register here.

Attend the Grid Evolution Summit hosted by SEPA on July 29 – August 1, 2019 | Washington, DC